Friday, September 23, 2016

The Economy Of Westeros

See 'Game of Thrones' economics: Austerity, tax and QE by Catherine Boyle on CNBC. From April 2014. Excerpt:

"Littlefinger is Westeros' Master of the Coin, and as the books describe, has "a gift for rubbing two golden dragons together and breeding a third."
Like the modern-day Federal Reserve, it seems as though he has been doing his own version of quantitative easing by injecting more gold dragons into the economy (although in a rather less sophisticated way, by clipping coins to create more money)."

Quantitative easing is a name given to a policy that tries to increase the money supply. The Fed buys long-term bonds. They basically create as much money as they want. This is an attempt to stimulate demand and try to increase output in the economy.

"In ancient times, the Romans clipped coins to increase the money supply. See Central Banks Clipping Coins by Bill Tatro of Excerpt:

As a form of payment back in those days, Julius Caesar routinely gave silver coins to his troops, and it was clearly understood that the silver coins were indeed 100% silver.  In other words, there was no mixing with other cheaper metals. 
Thus, knowing the Roman coin was 100% silver, the only way to devalue the currency was to take a knife and shave, or “clip,” some silver off the edges of the coin.  Consequently, we now seeRoman coins of antiquity with very odd shapes, all thanks to “clipping.”

For example, 100 coins could be “clipped” in order to create an additional 5 coins"

The ridges on coins might have been a way to prevent this clipping. I suppose you could tell if they were clipped if there were no longer any ridges on the edge of the coin. See also The Westeros Economy: A Financial FAQ for GoT Fans By Caroline Hsu of Investopedia

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